Does Cinnaholic anticipate that all franchisees will contribute to the Advertising Fund?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
entity if we deem appropriate. (See Franchise Agreement, Section 11.2.) We anticipate all of our franchisees will contribute to the Advertising Fund, although there is no prohibition against us charging higher or lower rates for future franchisees. (See Franchise Agreement, Section 11.2.) We also may forgive, waive, settle, or compromise claims by or against the Advertising Fund. We may defer or reduce a franchisee's contribution. If we terminate the Advertising Fund, we will distribute all unused monies to the contributors in proportion to their respective contributions during a pre-determined period. For the 2024 fiscal year end, we collected $504,162.50 in the Ad Fund. We expended $444,137.79 in the following approximate proportions: Online Advertising ($89,825.20, or 20.22%), Social Media ($268,087.81, or 60.36%), Marketing Consultants ($61,800, or 13.91%), Creative ($12,846.00, or 2.89%), Publication Ads ($3,916.85, or .88%), Website ($6,030.88, or 1.36%), Administrative ($1,333.65, or .30%), and Miscellaneous ($297.40, or .08%). Fund expenses were more than Fund contributions during the year. $60,024.71 was collected in 2024, b
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 27–35)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, Cinnaholic anticipates that all franchisees will contribute to the Advertising Fund. However, Cinnaholic retains the right to charge future franchisees higher or lower rates. Cinnaholic may also defer or reduce a franchisee's contribution to the Advertising Fund.
The Advertising Fund is used by Cinnaholic to create promotional advertising, marketing programs, market research, and other marketing and advertising activities. Cinnaholic has sole discretion over the creative concepts, materials, media used, media placement, and allocation of these programs. Cinnaholic is not obligated to spend any amount on advertising in the area where a franchisee's Bakery is located, nor is Cinnaholic obligated to spend Advertising Funds to benefit all franchisees or ensure the monies are used proportionately to a franchisee's contributions.
Franchisees must contribute 2% of Gross Sales to the Advertising Fund. All affiliate-owned Bakeries or Bakeries that Cinnaholic owns will also contribute to the Advertising Fund on an equal percentage basis with all franchised Bakeries. For the 2024 fiscal year end, Cinnaholic collected $504,162.50 in the Ad Fund and expended $444,137.79. The largest expenditures were for Social Media ($268,087.81, or 60.36%) and Online Advertising ($89,825.20, or 20.22%).